Which of the Following Is not True Regarding Proprietary Funds

question 124

Multiple Choice

Which of the following is not true regarding proprietary funds?

• A) Accrual accounting and the economic resource measurement focus are used.
• B) Statements required are the Balance Sheet, the Statement of Revenues, Expenditures, and Changes in Fund Balances, and the Statement of Cash Flows.
• C) Long Term debt is recorded directly in the accounts.
• D) Proprietary funds financial reports include the Statement of Net Position, Statement of Revenues, Expenses, and Changes in Fund Net Position, and Statement of Cash Flows.

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Definitions:

Stockholders' Equity

The ownership interest of shareholders in a corporation, represented by their shares of the company.

Increase Assets

The act of growing the resources owned by an entity that have future economic value and can be measured and expressed in monetary units.

Business Entity Assumption

A principle in accounting that treats a business as separate from its owners or other businesses, allowing for independent financial accounting and reporting.

Accounting Equation

The accounting equation, Assets = Liabilities + Equity, is the fundamental formula in accounting, ensuring that a company's balance sheet is balanced.